Small Business

Hit the Road, Jacques

April 11, 2002

By Lisa Bergson "I'm not happy," complains our new European regional sales manager, call him "Jacques," speaking long distance from Belgium on Good Friday. "The pay cuts are quite difficult for us. Now, my wife has to get a job." Poor man. Never mind that I have a factory full of people, with a far less tightly woven safety net than he. They've borne the same hardship for months without complaint.

"We'll make it, we'll pull through," they assure me. Out here in Warrington, Pa., we take pride in our ability to withstand the sharp cycles of the semiconductor industry -- especially this latest and most severe downturn of all. Despite months of 20% pay cuts, pay freezes, no bonuses, and other austerity measures, I've yet to lose a single employee I wanted to keep.

CONTINENTAL DIVIDE. Regrettably, Jacques does not share their esprit de corps, and his performance shows it. Longstanding readers of "Factory Days" may recall that last spring and summer I made repeated trips to Europe and spent what, to us, was a small fortune in headhunting fees to hire this fellow. A botched hire, Jacques represents our very first foray into the European employment scene. Little did I know how much I had to learn about European labor, customs, and, particularly, law.

Now, as fate would have it, I have just the answer for Jacques' dissatisfaction. His severance letter sits on the middle of my desk. I've been bracing myself to deliver the bad news, and now he's falling right into my hands. It's almost too good to be true. "I understand," I say. "I haven't taken a salary myself since last fall, and it's tough at home. Actually, Jacques, things here have been so bad for so long, I've come to the conclusion that we really cannot continue to support your effort."

I went on to point out that this would work to his benefit since his severance package guaranteed him three months' pay, in accordance with his contract. "O.K., that sounds good," Jacques replied. I can't tell whether he is in shock or relieved. We agree that he'll think about it over the holiday weekend, and we'll talk again on Tuesday.

THE FINE PRINT. According to one of my mentors, "If something seems too good to be true, it probably is." Early the following week, Jacques calls. "I'm depressed," he says. In an odd monologue, he proceeds to alternately cajole me into keeping him on as an employee -- or even a consultant -- and to threaten legal action if we do not abide by the terms of his contract. Trouble is, I thought we were.

Amended to conform with Belgian law, Jacques' employment contract, alone, took over a month to negotiate. Our lawyer and headhunter both said that, to hire a national, such terms were mandatory. But, despite the oversight of my CFO, human resources manager, corporate counsel, and corresponding lawyer in Europe, this document would not prove as definitive as I expected.

Take Jacques' three-month severance, for starters. Itemizing his unexpected demands in a lengthy e-mail, Jacques writes, "It includes the gross salary, the bonus, the social security, the pension plan, the vacation, the 13th month and the medical coverage." He continues: "You are only proposing the yearly gross. This is not legal."

Further, while we informed Jacques in November that we were reducing him to a four-day work week, along with everyone else, he volunteered to carry on as usual "to sustain the business in these difficult times". Apparently, I should have forbidden him from so doing. Today, he insists, "MEECO, Inc. will have to pay me for these days I have been working." (Readers can debate that one.)

OLD WORLD WAYS. From the beginning, Belgian labor conventions have been a revelation for my staff and me. "If your aunt stubs her toe, you get a paid day off," chafes our chief financial officer, Eileen Jacob, alluding to the over 41 reasons Belgians are entitled to paid days off, occasions such as the "wedding of a child of the second wife of the worker" and celebration of the "humanist youth". That's in addition to 20 vacation days, ten paid legal holidays, and a 13th month. Yes, a 13th month.

Well-educated and multilingual Europeans tend to come at a premium: They are expensive to hire and maintain, and even more costly to fire. "You can never let him go," my lawyer warned when I hired Jacques. Now, I'm coming to the conclusion that a Continental employee, like so many fine European-made items, just may be a luxury we can't afford. Lisa Bergson is President and CEO of both MEECO and Tiger Optics. Before joining MEECO in 1983, Lisa Bergson worked as a business journalist at BusinessWeek and freelanced for many business publications. You can visit her companies' Web sites at www.meeco.com and www.tigeroptics.com, or contact her at lbergson@meeco.com